*The general rule for deposit of employee elective deferral contributions into the plan is the earliest
date that such contributions can reasonably be segregated from the employer’s assets but not later than the 15th business day of the month following the month
in which participants’ contributions are withheld from compensation.
is a safe harbor deposit rule that states if employee elective deferral contributions are deposited no later than the 7th
business day following the date contributions are withheld from pay then these contributions are deemed to be timely deposited.
Please note that if a deposit of contributions is determined to be late, the result is a prohibited transaction.
Accordingly the plan sponsor must contribute lost earnings and pay excise taxes on the amounts involved.
We strongly recommend that you adhere to the safe harbor deposit rule.
If you are
considered a large plan (more than 100 participants), the safe harbor deposit rule is not applicable and you may be required
to fund the contributions even sooner, depending on facts and circumstances.